ETH dive costs whale over $100M in losses – Crypto News – Crypto News
Connect with us
Ethereum plunges as Trump Ethereum plunges as Trump

Cryptocurrency

ETH dive costs whale over $100M in losses – Crypto News

Published

9 months ago

on

  • Whale loses $106M in Ethereum (ETH) liquidation on Sky due to a 14% price drop.
  • Crypto market sees $1.36B in liquidations, affecting 441,856 traders.
  • Trump’s tariffs and economic uncertainty drive market sell-offs.

An Ethereum whale on the decentralized finance (DeFi) lending platform Sky, formerly Maker, has been liquidated following the crash of the price of Ethereum (ETH).

This whale lost 67,570 ETH, valued at approximately $106 million, following the sharp decline in ETH’s market price as the crypto market melts down following President Donald Trump’s ‘Liberation Day’ tariffs.

The Ethereum whale lost 67,570 ETH to liquidation

The whale’s downfall came as ETH’s price plunged 14% on April 6, dragging the collateral ratio of their position down to 144%.

Unable to maintain the necessary buffer, Sky liquidated the entire 67,570 ETH stash, wiping out over $106 million in value.

Notably, Sky operates as a DeFi lending platform where users can deposit cryptocurrency like ETH as collateral to borrow DAI, a stablecoin pegged to the US dollar.

To mitigate the risks posed by crypto’s volatility, Sky enforces an overcollateralization requirement. This means borrowers must lock up significantly more value in ETH than the DAI they borrow.

When collateral values dip below this threshold, the system triggers liquidation, seizing the assets to repay the loan.

The whale’s liquidation is not an isolated event but part of a seismic shift rattling the cryptocurrency landscape.

Over the past 24 hours, the crypto market has seen 441,856 traders liquidated, with the total liquidations coming to $1.36 billion, according to Coinglass.

The liquidations come as cryptocurrency heavyweights like Bitcoin (BTC), Ethereum (ETH), XRP, Solana (SOL), and Dogecoin (DOGE) reel from double-digit losses.

Bitcoin, for example, has slipped below $75,000, a steep fall from its recent peak near $90,000, signaling widespread distress across the sector.

With the sharp BTC price drop, a wrapped Bitcoin whale has been liquidated four times, losing over $19 million in less than 50 days.

Another major player, holding 56,995 wrapped ETH worth roughly $91 million, teeters on the edge of liquidation on Sky.

Trump’s tariffs cause market turmoil

The current crypto market downturn comes as Donald Trump’s “Liberation Day” and threats of global retaliatory tariffs stoke economic unease.

The tariffs have triggered a sell-off in traditional stock markets, spilling over into crypto as investors flee riskier assets.

The mounting fear of a looming financial crisis has only deepened the gloom enveloping digital currencies.

Analysts are scrambling to map out what lies ahead, with Charlie Sherry of BTC Markets pointing out that Bitcoin has lost its $79,000-$80,000 support zone, leaving $72,000—the pre-election high—as the next critical floor.

Geoffrey Kendrick from Standard Chartered cautions that Sunday’s crypto tremors could foreshadow a rough Monday for stocks, hinting at deeper interconnections between markets.

However, glimmers of hope persist, with Sherry positing that a reversal in Trump’s policy stance or an emergency move by the Federal Reserve, such as slashing interest rates, might buoy the market.

Recently, traders ramped up bets on Fed intervention to avert a US recession, a step that could pump liquidity into the system and offer crypto a lifeline.

As the crypto world braces for what’s next, caution remains the watchword for those navigating this turbulent terrain.

Share this article
Categories
Tags

Related Topics:
Continue Reading

Trending